cedaar textile reported a net loss of ₹7138.47 lakh for the financial year ended March 31, 2026, driven by a material inventory write-down of ₹84 crore. The company's statutory auditors, M/s. H B Kalaria & Associates, issued a disclaimer of opinion on the audited financial results, citing significant gaps in audit evidence and uncertainties regarding the company's ability to continue as a going concern.

The Board of Directors approved the audited financial results for the half year and financial year ended March 31, 2026, during a meeting held on May 30, 2026. The filing was made pursuant to Regulation 30 and 33 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015.

Auditor's Disclaimer and Key Findings

The auditors highlighted several material issues that prevented them from forming an opinion. The accounting data and financial records for the period from April 1, 2025, to September 30, 2025, were irretrievably lost due to the discontinuation of the company's cloud-based accounting software and damage to cloud storage infrastructure. Consequently, the auditors could not verify transactions, account balances, or opening balances carried forward from the preceding year.

Additionally, the company defaulted on the repayment of loan instalments and interest dues for two months. While the bank adjusted the overdue dues against fixed deposits after the year-end, the auditors noted insufficient evidence to evaluate the appropriateness of the going concern assumption. The company also failed to conduct physical verification of property, plant, equipment, and inventories, and did not perform reconciliations for trade receivables and payables.

Financial Performance

The company reported a total revenue of ₹16,466.15 lakh for the financial year ended March 31, 2026, a decrease from ₹20,873.00 lakh in the previous year. Total expenses rose to ₹25,017.45 lakh from ₹19,303.49 lakh in the prior year.

The loss was significantly impacted by the liquidation of approximately 80-85% of total inventory as scrap due to colour bleeding, resulting in the ₹84 crore write-down. Management attributed the deterioration to prolonged storage caused by a halt in export orders following U.S. tariffs and geopolitical tensions.

Balance Sheet and Cash Flow

As of March 31, 2026, the company's total assets stood at ₹22,828.31 lakh, while total liabilities were ₹17,985.21 lakh. Shareholders' funds decreased to ₹4,843.11 lakh from ₹6,567.44 lakh in the previous year. Short-term borrowings increased to ₹8,651.24 lakh from ₹8,247.28 lakh.

Cash flow from operating activities was negative at ₹3,168.65 lakh, compared to a positive inflow of ₹1,720.53 lakh in the previous year. The company raised ₹5,414.14 lakh from the issue of shares and ₹5,154.98 lakh from long-term borrowings, while repaying ₹6,076.08 lakh of long-term debt.